An Empirical Study on Financial Performance of 'The Tirupati Cooperative Bank Limited', Tirupati

Abstract

The study mainly focused attention to study the financial performance of Urban Cooperative banks with reference to Tirupati Town Co-Operative Bank Limited in Tirupati, which were covered under schedule II of RBI Act. In this regard, schedule II of RBI Act consists of 55 Urban Cooperative Banks. The researcher aims to analyze the financial performance of UCBs with reference to Tirupati Town Co-Operative Bank Limited. Survival and success in competitive markets demand performance through continuous improvement and learning. In a regime of planned development, sound cooperative banking movement is an instrument, which while retaining some of the advantages of decentralisation and local initiative, will yet serve willingly and readily the overall purposes and directives of the developmental plans of the government in the identified sectors. It is an indispensable instrument of planned economic action in a democracy. Urban Cooperative Banks (UCBs) figure among the vital segments of the banking industry of the country. They essentially cater to the credit needs of persons of small means. Though some UCBs have performed creditably in the recent years, a large number of them have shown discernible signs of weakness. The operational efficiency is unsatisfactory and characterized by low profitability, ever-growing Non-Performing Assets (NPAs) and relatively low capital base. It is therefore imperative to judge their relative performance and understand the best practices for better survival. In this context, this paper makes an attempt to examine the working and financial performance of the UCBs. The study is based on secondary data and other information provided by the bank in its published annual reports from 2006-07 to 2009-10, that is for 4 years, apart from the records of various financial institutions, including the RBI reports, manuals for UCBs and Bulletins, Reports of different committees and federations. In addition, various manuals, official circulars, and auditors reports have also been consulted to the study the different banking variables of the study. To make the analysis simpler and presentable, the author takes up The Tirupati Co-operative Bank Ltd, one of the leading UCBs Chittoor District of Andhra Pradesh. The objective of the study is to identify and analyze the trend, progress and to throw light on the problems of the bank and to offer some meaningful suggestions for improving the efficiency and effectiveness.